Disability insurance may not be at the forefront of your to-do list, but we tell you it should be. It can be an often-overlooked insurance avenue, with people mistaking or replacing it with life insurance. However, they are both separate and equally as important. Did you know that around 110 million Americans don’t have long-term disability coverage? Yet, over 375,000 Americans become disabled each year.
This is especially true for millennials who feel their risk level is low due to their younger age. However, 35-year-olds face a 50 percent chance of suffering a disability for a period of 90 days or longer before the age of 65. Even with jobs that don’t present an obvious threat, or those who are freelancers and employ themselves, it is crucial for these millennials to equip themselves with disability insurance to prepare for any circumstance.
So what exactly is it? Disability insurance would protect your paycheck if you were to lose your ability to work due to an illness or injury. This type of insurance pays a sum roughly equivalent to your take-home pay and can help pay for essential expenses, like food, utilities, mortgage, and car payments.
Here are five reasons why you should get disability insurance today:
1. Unexpected disabilities are statistically common.
Accidents or medical issues can arise at any moment, no matter how careful we are. According to the Social Security Administration, over a quarter of today’s 20-year-olds will experience a disabling injury or illness before they reach retirement age. Another staggering statistic is that you are more likely to become disabled than die at any point during your working career.
While physical injuries or accidents are one form of needing disability insurance, it only makes up a small percentage of claims. It’s important to remember that illness or medical conditions can take you away from the workplace or make you unable to perform your daily routine. Serious illnesses, such as cancer and heart disease, and musculoskeletal disorders like arthritis and back pain, account for most disability claims.
2. You’re the breadwinner, or people rely on you financially
If you are the main source of income in your household or have people you help provide financially, disability insurance is necessary. It is a proactive way to ensure that it will protect against any potential financial losses for you and the people who rely on you.
Disability insurance can provide a safety net to ensure that you are receiving the appropriate amount needed to continue care for yourself and others. This is most commonly seen in families through supporting a spouse, children, or even elderly parents. If you aren’t able to care for them, who is?
3. You’re paying off debt
The average American has $90,460 in debt, according to a 2021 CNBC report. That included all consumer debt products, from credit cards to personal loans, mortgages, and student debt. If you have debt you are working to pay off, then a sudden loss of income could greatly impact your ability to make these payments on time.
When finding a disability insurance plan, you should factor your debt balances into your coverage amount every month. This would ensure that you have the proper financial assistance to continue making these payments if you ever find yourself injured or ill and need disability.
4. Benefits with work are often lacking for disability
Many companies provide insurance for their employees, but disability insurance is more often insufficient than other benefits. While this group coverage is inexpensive and nice to know you have, it’s rarely enough by itself.
Group disability insurance plans often place a cap on benefits and use your base salary, not taking everything into account. This is especially problematic for high-income earners because their benefits are cut off at a certain dollar amount. Plus, if you were ever to leave your job, you would lose your coverage and have a period where security is not there.
If you are a freelancer or independent contractor, finding your disability insurance plan is equally important. Without a company behind you, you need to be proactive in protecting yourself financially if anything were to happen.
An individual disability insurance plan allows you to select a higher benefit amount based on your total income. Plus, premiums are paid after-tax dollars, so your benefits will not be taxed.
5. Peace of mind
While it may be short-term or long-term, the financial help that disability insurance provides is invaluable in making sure you can afford to live without sacrifice. It is a way to prepare for the unexpected and know that you and your loved ones will be taken care of under these circumstances. By putting a policy in place when you are young and healthy, you will be able to lock in lower rates and have peace of mind as you move through life.
Take the first step today and find a plan that is right for you. At Heroes Sick Pay we work with you to place you with the right insurance plan that will provide the proper coverage and security should you ever need it!
